YOUNGSTOWN – City council will consider legislation Wednesday to spend up to $130,000 for a law firm to assess the functionality and long-term financial viability of SOBE Thermal Energy Systems LLC, the troubled downtown utility company.

The legislation, sponsored by Mayor Derrick McDowell, would permit the board of control, of which he is chairman, to sign the agreement with Roetzel & Andress, a law firm whose Akron office has handled some high-profile cases for the city.

The legislation states the law firm would assess SOBE’s functionality and “identify financially sustainable long-term solutions ensuring that the steam system operates safely and reliably.”

If hired, Roetzel & Andress could offer insight into whether and how SOBE can operate under new ownership.

While the city has previously ruled out buying and operating the utility — city hall is one of SOBE’s main customers — it could be reconsidered.

SOBE, which provides steam heat for the majority of downtown, has experienced significant financial problems and would have shut down if not for the Public Utilities Commission of Ohio intervening and placing a receiver in charge of the struggling company.

That receiver, Reg Martin, was removed after less than five months on the job with the current receiver, John C. Collins, recently saying the company’s “finances are not good,” and that SOBE cannot pay the $55,570 owed to Martin and his attorney because if it was paid “all at once, it could hurt the company financially. It could impact our ability to pay other expenses. $55,000 would be a lot of money at this time for the company to pay.”

Andy Resnick, the city’s spokesman, said Thursday, “Our hope is to finally get a clearer picture of what’s going on over there to hold SOBE and PUCO, the designated state authority, accountable and come up with real solutions. We are not going to allow our residents and businesses to go through another winter season like the last one.”

Mahoning County Common Pleas Court Judge Anthony Donofrio on Sept. 26 appointed Martin as SOBE receiver and Kenneth R. Goldberg as his legal counsel at the request of the PUCO, as the company was insolvent and unable to provide heat to its customers.

A rented 800-horsepower boiler was repossessed Sept. 30 from SOBE because the company defaulted on paying for the equipment that provided heat and hot water to its 28 downtown Youngstown customers. That resulted in SOBE abandoning the city.

SOBE owed $383,214 in back payments to the steam plant’s owner, Wabash Power Equipment Co. of Wheeling, Illinois. The repossession would have made the company unable to provide utilities to its customers.

But the equipment rented by Martin proved to be unreliable during the winter months. SOBE’s boilers repeatedly failed to provide proper heat and hot water for its customers, forcing a number of them to shut down.

Several buildings were without heat for five days, starting Feb. 7, after the failure of two SOBE boilers, including an 800-horsepower one that arrived Feb. 1.

That came only days after SOBE couldn’t provide heat from Jan. 27 to Feb. 2, and Feb. 3 in some buildings, during days when the temperature was well below zero. Even after steam heat started flowing, some businesses couldn’t get it because of broken pipes.

Without the repossessed boiler, Martin was able to rent a 650-horsepower steam plant that was hooked up about 10 days after the other was taken away.

Because of the $750,000 Martin received from Enbridge Gas Ohio as part of the company’s settlement of the 2024 Realty Tower gas explosion investigation by the PUCO, he was able to rent a 200-horsepower boiler.

Martin also used the Enbridge settlement money to later rent an 800-horsepower boiler, which arrived Jan. 30. But that and the 650-horsepower boiler failed Feb. 7, with heat not restored to buildings until Feb. 12.

When Martin took control of the company, he said it owed millions of dollars in unpaid bills and could go out of business.

Numerous customers criticized Martin for being unresponsive and not doing enough to get heat to buildings during the coldest periods of the year.

Donofrio on Feb. 17 granted a PUCO motion to remove Martin as SOBE’s receiver. The PUCO request came Feb. 11.

Donofrio also granted requests from the PUCO on Feb. 17 to appoint Collins of Akron to replace Martin and for Michael J. Moran, a Cuyahoga Falls attorney, to replace Goldberg as the company’s legal counsel.

Magistrate Nicole Butler agreed April 2 to permit Youngstown to intervene in the receiver court case.

The city sought injunctive relief to intervene to have SOBE “provide necessary and adequate service to customers as required by Ohio law, order the receiver to inform SOBE customers and counsel for the PUCO of any maintenance issue that could affect customers within eight hours of said issue, order the receiver to inform this court and the PUCO within 24 hours of any temporary outage of SOBE Thermal’s systems, direct the receiver to escrow funds payable to the receiver and the receiver’s counsel with the clerk of courts until SOBE has proven it is consistently operational, and any other relief this court deems just and equitable.”

SETTLEMENT PROPOSED

City council will consider an ordinance on Wednesday to let the board of control finalize a $47,500 settlement agreement as a result of a Sept. 20, 2024, crash in which Detective Sgt. Edward Kenney’s police cruiser hit a vehicle from behind during a pursuit on Hughes Street on the city’s South Side.

The agreement will pay $40,000 to Ashley Lintz of Youngstown, who sustained injuries in the crash, and $7,500 to Kendal Lee Dotson of Youngstown, whose 2011 Honda Acura was totaled.

An accident report states an 8-year-old girl in the car driven by Lintz was also injured, while Kenney wasn’t hurt.

The report states Lintz stopped on the road to yield to an emergency vehicle when she was hit from behind by a 2022 Ford Explorer city police cruiser driven by Kenney. The cruiser received extensive damage in the crash.

Kenney said he was looking for street markers during a pursuit when he looked into the sun and didn’t see Lintz had stopped, and hit the vehicle, according to the police report.

Lintz and Dotson didn’t file a lawsuit against the city, but did retain an attorney, who worked out a settlement agreement with the city.